Facebook recently announced its intentions to acquire the popular messaging app, WhatsApp in an initial cash and stock deal worth roughly $16 billion, not including an additional $3 billion provision for restricted stock units. According to Facebook, the social media giant said it plans to purchase the mobile messaging firm with $4 billion in cash and approximately $12 billion worth of Facebook shares. The additional $3 billion payout in restricted stock units will be granted to WhatsApp founders and employees and they vest in four years after the deal closes.
Facebook founder and CEO, Mark Zuckerberg, said the following in a prepared statement:
WhatsApp is on a path to connect 1 billion people. The services that reach that milestone are all incredibly valuable. I've known [WhatsApp founder Jan Koum] for a long time and I'm excited to partner with him and his team to make the world more open and connected.
Another thing that remains unknown is what the buy means for WhatsApp’s pricing structure, which currently stands at a yearly $0.99 fee for unlimited usage. The app was free when it debuted in the iOS App Store but the company chose to institute the annual charge to keep the service ad-free under a crush of new users.
One thing we do know is that the major acquisition hints at a strong push in advancing Facebook’s messaging service, Facebook Messenger, which is also widely used but has been eclipsed by third-party services that offer a more user-friendly and connected experience. For now however, WhatsApp and Facebook Messenger will remain separate standalone apps.
Although WhatsApp touts a massive installed worldwide user base, Facebook seems to be making definite inroads into Europe, where the messaging app is very popular.
We’ll have to wait and see what’s to come.
Source: Facebook (Press Release)